See it

TOP 10 STOCKS TO BUY

Menu

Amazon Stock Price

Prediction: Is It Worth
The Hype?
Amazon Stock Price Prediction: Amazon
[NASDAQ: AMZN] is one of those stocks that
people just love. The company seems to
be everywhere, from Whole Foods to dog
food, media devices to smart speakers, and
everything else under the sun – and that’s not
even mentioning the company’s web services.

With so many irons in the !re, there are lots

of ways that Amazon can make money.

Amazon E-Commerce Earns

the Company Billions
Amazon has been pro!table for 15 straight
quarters, and it is still growing.

The company’s core North American business

has almost doubled since 1Q17, with no signs
of slowing down.

“Shoppers will spend $484 billion globally on

Amazon this year, up 26 percent from 2018,”
writes Bloomberg, “and the Seattle-based
company will capture more than half of all
online spending in the U.S.”

Amazon’s strategy of late has been to use the

low-margin business of online retail to attract
shoppers, ultimately boosting its devices
business and sales of other Amazon-owned
goods.

The company has also been pushing into

advertising, content creation, and web
services. These areas have much higher pro!t
margins than retail.

Amazon AWS is Highly

Pro!table
Amazon Web Services (AWS) is a service
o"ering geared towards companies,
governments, and schools as well as startups.
Amazon AWS is number one in cloud
computing, topping even Microsoft
[NASDAQ: MSFT].

Some of Amazon’s clients include Adobe

[NASDAQ: ADBE], Capital One [NYSE: COF],
Comcast [NASDAQ: CMCSA], Condé Nast,
Dow Jones, Kellogg’s and Unilever.

[MSFT] Microsoft Corp

JS chart by amCharts

180 $
$

160

140 $ $

120

100
Jul 2019 Oct 2019 Jan 2020 Apr 2020

JS chart by amCharts
50

0
Jul 2019 Oct 2019 Jan 2020 Apr 2020

View More »

For the right price, Amazon’s AWS can handle

all of your computing, database, and storage
needs. And that’s just the beginning
because AWS also includes blockchain, game
tech, Internet of Things (IoT), customer
engagement, robotics, machine learnings,
security, and more.

The AWS segment is highly pro!table, and it is

growing. In 1Q19, sales at Amazon’s AWS
grew 45% to top $7.4 billion for the quarter.

Amazon Advertising
Revenue Is Rocketing Up
When investors talk about Amazon, they are
usually speaking about the number of Prime
subscribers, the success of Amazon devices,
grocery, or AWS, but Amazon is making
serious headway in another area –
advertising.

According to Piper Ja"ray analyst Michael

Olson, Amazon’s advertising income will
exceed AWS by 2021.

He predicts that Amazon Web services will

bring in $15 billion in 2021 while advertising
will pull $16 billion the same year.

“Being the world’s largest product search

engine has its advantages,” explains Olson,
“and Amazon is starting to leverage them.”
The online retailer can learn things about its
customers that most companies simply
cannot.

From the books they read to the foods they

eat, their technology preferences to the
clothes they wear, Amazon has data on all of
it – and that information is valuable to
companies trying to target speci!c audiences.

Amazon Is Growing Fast

Globally
In 1Q19, Amazon’s losses from
its international operations reached $642
million and the revenue outlook remains
weak for much of its e"orts.

While Amazon CFO Brian Olsavsky blamed

depressed international revenues for the
period on currency exchange rates, the online
retail giant is going to need to be careful
where it tries to grow.

Take India for example. Amazon [NASDAQ:

AMZN] has been aggressively targeting
business there but changing laws on foreign-
owned companies could put a dampener on
that.

[AMZN] Amazon.com Inc

JS chart by amCharts
$

2,400

2,200

$
2,000

$
$
1,800

1,600
Jul 2019 Oct 2019 Jan 2020 Apr 2020

JS chart by amCharts
50

0
Jul 2019 Oct 2019 Jan 2020 Apr 2020

View More »

Due Diligence is Important,

Even for Amazon
The giant from Seattle is extremely agile, and
it has so much customer loyalty. Between
Kindles, Echoes, and Prime membership,
Amazon has a strong funnel for building
revenue, but nothing is guaranteed.

The online retailer could miss the mark. It has

before. Remember the Fire Phone? Amazon
only sold 35,000 units and lost somewhere
around $170 million on the venture. Ouch!

The worst part is that the Fire Phone wasn’t

even a bad device. Some of the technology
that product incorporated was novel at the
time, like multiple cameras and depth
sensing, has since become standard.It just
didn’t work, and it is not the company’s only
mishap.

All it would take is for one catastrophic

mis!re or an alternative supplier to come in
with the right product o"erings and lure
Amazon’s customers away.

It may not be likely, but it could happen.

Investors need to be extra critical when
looking at marquis stocks like this because
returns are not guaranteed but it is usually
priced at a premium.

Could Amazon Rise To

$2,200 Per Share?
So what is the Amazon stock price prediction?
Amazon has a 52-week range of $1,265.93 to
$2,050.50. One-year target estimates are
predicting that the company will reach
$2,138.39 in the next year alone, but that is
just an average.

Some analysts are predicting that Amazon

will reach $2,700 per share by this time next
year.

Almost universally, experts agree that

Amazon is a good buy and that only big
things are ahead for the company, but there
are still those naysayers who think that
Amazon [NASDAQ: AMZN] may have run as
far as it is going to go, at least for the
foreseeable future.

You will have to decide what you think about

Amazon’s future for yourself. In any case,
with so much room to run, it’s probably best
to buy Amazon on a dip if you are going to
open a position in the company.

[AMZN] Amazon.com Inc

JS chart by amCharts
$9.00
,000
$8.00

,500 $7.00

$6.00
,000
$ $5.00

,500 $4.00
$
$3.00
$
,000 $
$ $2.00

,500 $1.00
Jul 2019 Jan 2020 Jul 2020 Jan 2021

View More »

The author has no position in any of the stocks

mentioned. Financhill has a disclosure policy. This post
may contain a#liate links or links from our sponsors.

Previous Next

! Will Square Stock Price What Are The Top Stocks "
Rise 100% In 2020? Under $5: Buy or Sell?

Investing
Tesla vs Apple Stock: Which Is Best?

5 Stocks That Move A Lot

Disney vs Apple Stock: Which Is Best?

How To Short A Stock With Options

Druckenmiller: Worst Reward To Risk Ever?

Is T. Rowe Price Blue Chip Growth Fund A Good

Investment?

Royal Gold Stock Forecast

IPG Photonics Stock Forecast

Best Defense Stocks To Buy

Raytheon vs Lockheed Martin Stock: Which Defense

Giant Is Best?

© 2020 Financhill. All rights reserved. #

Know Your Risk Before You Trade